India manages finances well, but energy price rise will hurt: IMF MD

Gopinath was addressing a recent media roundtable on the Russian invasion of Ukraine and its global impact.

"India relies heavily on energy imports and the price is going up. That has implications on the purchasing power of Indian households. If you're looking at headline inflation numbers, inflation in India is close to around six per cent, which is the upper end of the inflation band for the Reserve Bank of India," Gopinath was quoted as saying by media reports.

This has implications on the monetary policy in India and it is a challenge in many parts of the world, she said.

"Clearly the most significant channel of impact on the Indian economy is energy prices," Georgieva said.

"Our advice to our members is first and foremost make sure that you protect the most vulnerable populations from the shot up of prices, not only energy but also foot food prices for countries where this is going to be a significant factor," the IMF managing director said.

"Target your fiscal space to those that are in a grievous need to be supported. We would also be looking into monetary policy responses, as to how could they be calibrated appropriately to what is happening," Georgieva added.

ALCHEMPro News Desk (DS)